In the first half (1H) of the calendar year (CY) 2024, solar projects totaling 14.9 GW were added in India, an increase of 282% compared to 1H 2023. According to the newly released Q2 2024 India Solar Market Update by Mercom India Research, installations topped all previous half-yearly and annual installations.
The commissioning of several previously delayed projects contributed to capacity additions in the year’s first half.
In the second quarter (Q2), 5 GW of solar capacity was commissioned. Installations dropped over 49% quarter-over-quarter (QoQ) compared to 9.9 GW installed in Q1 2024. Capacity additions rose 170% year-over-year (YoY) compared to 1.8 GW in Q2 2023.
During Q2 2024, 4.3 GW of large-scale solar projects were commissioned, including nearly 1.8 GW of open access solar projects. Large-scale solar capacity additions fell more than 55% QoQ compared to 9.5 GW in Q1 2024 and rose over 191% YoY compared to 1.5 GW in Q2 2023.
Project delays due to grid connectivity and transmission infrastructure issues significantly affected quarterly additions for large-scale solar projects. The reimposition of the Approved List of Models and Manufacturers (ALMM) order further impacted the viability and commissioning of several open access projects, contributing to substantial delays during the quarter.
Rajasthan, Gujarat, and Karnataka led in terms of large-scale solar capacity additions for the quarter, accounting for 30%, 22%, and 21% of installations, respectively.
“2024 is shaping up to be a breakout year for India’s solar industry, with an impressive first half. However, to ensure that the strong pipeline of projects and ramped-up tender activity translate into timely installations, it is critical that we tackle the component supply and grid connectivity challenges with urgency so we can meet the 280 GW target by 2030,” said Raj Prabhu, CEO of Mercom Capital Group.
In 1H 2024, India added 20.8 GW of new power capacity. Renewable sources, including large hydro, accounted for more than 81%; solar alone accounted for over 71% of the new capacity additions.
As of June 2024, India’s cumulative installed solar capacity stood at 87.2 GW. Utility-scale projects accounted for nearly 87%, and rooftop solar accounted for over 13% of cumulative installations. Solar energy accounted for 19.5% of India’s installed power capacity and over 44% of the total installed renewable energy capacity.
Rajasthan, Gujarat, and Karnataka were the top three states for cumulative installed large-scale solar capacity, accounting for 29%, 15%, and 14% of the country’s installed capacity.
As of June 2024, the Top 10 states accounted for more than 94% of cumulative large-scale solar installations.
India’s large-scale solar project pipeline stood at 146 GW, with another 104 GW of projects tendered and pending auction as of June 2024.
India’s solar module and cell imports dropped more than 61% QoQ and 16% YoY. The exports were down almost 30% QoQ, with only a marginal drop YoY.
The average cost of large-scale solar projects was down 2% QoQ and almost 26% YoY.
In Q2 2024, 10.7 GW of tenders were announced, a 21.6% decrease from 13.6 GW in Q2 2023. Tender activity dropped 65.2% QoQ compared to 30.7 GW.
During the quarter, 6.7 GW of solar PV projects were auctioned, similar to Q2 2023. Auction activity decreased by 73.2% compared to 25.1 GW in Q1 2024.
In 1H 2024, 41.4 GW of tenders were announced, the highest ever in 1H bid invitations. The tendered capacity issued in 1H 2024 increased 51% from 27.5 GW in 1H 2023.
In 1H 2024, 31.8 GW of projects were auctioned, up 321% from 7.6 GW in 1H 2023. The auctioned capacity was higher than any previous 1H and annual auction announcements.
Key Highlights from Mercom India Research’s Q2 2024 India Solar Market Update:
India added 5 GW of solar capacity in Q2 2024, down by 49% QoQ and up 170% YoY
Solar accounted for 71% of new power capacity additions in Q2 2024
Rajasthan, Gujarat, and Karnataka led quarterly large-scale solar capacity additions
In 1H 2024, solar projects totaling 14.9 GW were commissioned, up 282% YoY
India’s cumulative installed solar capacity stood at 87.2 GW as of June 2024
Rajasthan, Gujarat, and Karnataka led the country’s cumulative large-scale installations
India’s large-scale solar project pipeline stood at 146 GW, with another 104 GW of projects tendered and pending auction
Average large-scale project costs fell 2% QoQ and 26% YoY
Tender announcements in Q2 fell 65.2% QoQ and 21.6% YoY, while auction announcements fell 73.2% QoQ and only marginally YoY